Free Response in Opposition to Motion - District Court of Arizona - Arizona

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PAUL K. CHARLTON United States Attorney District of Arizona Reid C. Pixler Assistant U.S. Attorney Arizona State Bar No. 12850 Two Renaissance Square 40 North Central, Suite 1200 Phoenix, Arizona 85004-4408 Telephone: (602) 514-7500 [email protected]

UNITED STATES DISTRICT COURT DISTRICT OF ARIZONA UNITED STATES OF AMERICA, Plaintiff, v. 1. Lear Jet, Model 31A, Serial Number 31A-224, U.S. Registration # N224LJ; 2. Agusta Helicopter, Model A109E, Serial Number 11116, Mexican Registration # XA-TSR; 3. Cessna Caravan, Model 208B, Serial Number 208B-0941, Mexican Registration # XA-TUF. Defendants. PRELIMINARY STATEMENT The plaintiff, files this Response in Opposition to the request filed by counsel for Abed to CIV-04-363-PHX-JWS
RESPONSE IN OPPOSITION TO MOTION TO FILE ADDITIONAL PLEADINGS RE: ORDER FROM CHAMBERS DATED AT ANCHORAGE, ALASKA JULY 26, 2005

ORAL ARGUMENT REQUESTED

20 file additional pleadings which are not dispositive of the issues before this Court. The point of 21 this charade is to convince the Court that there are numerous Amparos filed around the country 22 which are supposed to prove that the Government of Mexico is not cooperating with the 23 Government of the United States regarding the service of in rem process executed by this Court. 24 In fact, the pleadings proposed and presented by counsel for Abed should cause this Court 25 substantial concern. The fact is, it is apparent that counsel for SIASA have engaged in a very 26 visible form of forum shopping in Mexico to obtain an Amparo from a sympathetic or 27 "influenced court" in a jurisdiction unrelated to the base of operation of SAISA and inconvenient 28

Case 2:04-cv-00363-JWS

Document 117

Filed 10/06/2005

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to the PGR of Mexico. As quickly as the Amparos have been issued they have been lifted or

2 removed when the position of the government has been presented. Notice that one Amparo was 3 applied for in Quintana Roo and another was applied for in Toluca, and the location of the 4 "Twenty-Seventh Collegiate Court" is not mentioned. Quintana Roo is located on the Yucatan 5 Peninsula adjoining the Gulf of Mexico and Toluca is a mountain community near Mexico City. 6 What should be apparent is that SIASA has been required to run all over the country, continually 7 seeking a new order from a friendly judge unfamiliar with the history of the case. 8 The Amparo process is a temporary action to insure the review of the actions of the

9 government. Amazingly, a litigant such as SIASA is free to apply for as many Amparos as they 10 may choose at every step along the process, and the resolution of one Amparo does not 11 necessarily have any impact upon the next application. The process becomes the objective. At 12 any given point in time SIASA can have a number of Amparos pending to prevent some action 13 until further review. The point is, the existence of a form of restraining order is not an issue 14 which should be considered by this Court in the determination of whether Mexico has served the 15 in rem warrants. The very fact that SIASA has to admit that the PGR continues to control the 16 aircraft and continues to engage and defeat the filings of SIASA, is proof positive that the 17 process has been served and is continuing to be pressed by the government of Mexico. 18 The question which this Court must consider is whether this process is indicative of the

19 purpose or intention of the government of Mexico to serve and carry out the in rem process of 20 this Court. It is absolutely clearly the intent of the government of Mexico to serve the process, 21 including litigating all of the Amparo suits filed by SIASA. It is absolutely clear that Abed and 22 his attorneys will attempt to exploit the differences in the process and judicial procedures of 23 these two countries to try to convince this Court that the process has not been served. SIASA 24 attempted to obtain its first Amparo simply on the basis that the United States had requested the 25 service of the in rem process in Mexico, incorrectly assuming that the request would be made 26 to physically restrain the aircraft. For reasons explained in a previous pleading, plaintiff 27 requested the use of a constructive seizure and substitute custodian agreement, executed by 28 representatives of SIASA, to prevent exactly the type of activity now alleged regarding the loss
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1 of revenue and harm occasioned by SIASA. The point is not to focus upon the smoke generated 2 by SIASA, but the actions of the PGR. The PGR has clearly sought to carry out the orders of 3 this Court. 4 What has SIASA/Abed done? In the United States Abed has claimed that the Court has no

5 jurisdiction over the res unless the res is actually physically taken into custody. The United 6 States disputes this false argument, relies upon the substitute custodian agreement executed by 7 the representatives of SIASA, and that is the basis for the Motion to Reconsider the Order from 8 Chambers of July 26, 2005. SIASA has appeared before the Court by filing a Statement of 9 Interest and an objection to plaintiff's Motion for Entry of Default. SIASA has not filed an 10 Answer and default judgment is appropriately before this Court. When judgment is entered in 11 favor of plaintiff and the interest of SIASA is awarded to plaintiff, through international 12 requests, plaintiff will own the interest of SIASA in the res and will order all of the Amparos in 13 Mexico dismissed or withdrawn. Once the obstacles intentionally placed in the record by 14 Abed/SIASA have been removed, there will be no doubt that the PGR and the government of 15 Mexico is fully cooperating with the United States in this joint investigation directed to an 16 international bank fraud and money laundering scheme which benefits only the possessors of the 17 tainted assets. 18 In Mexico Abed/SIASA has taken a different approach, 180 degrees opposite from that

19 which Abed/SIASA has taken in the United States. It accepted the execution of a substitute 20 custodian agreement which crippled the ability to apply for an Amparo. Because the aircraft 21 were not removed from the custody and control of the company, all that was required was the 22 payment of the lease to the PGR, pending resolution of the issues contained in this action. 23 SIASA clearly accepted the in rem process in the agreement. To force the issue into a situation 24 where Abed/SIASA could claim damage and have an ability to obtain multiple Amparos, 25 Abed/SIASA forced a confrontation by refusing to pay the lease payments, as required in the 26 substitute custodian agreement. In response, according to the materials presented by Abed, the 27 PGR took the aircraft into custody. For the purpose of attempting to defeat the jurisdiction of 28 this Court, Abed/SIASA has filed multiple suits in Mexico seeking to temporarily block the
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1 transfer or sale of the aircraft, providing a basis for counsel for Abed to misrepresent the 2 significance of the impact of these temporary orders. These are intentional acts taken solely to 3 manipulate the record, create issues to cloud the ultimate focus on the administration of justice 4 i.e., the ownership of the funds used to acquire the aircraft, and to confuse and mislead this 5 Court. 6 Due to the frequency, geographical range, and the potential that such orders are issued

7 exparte, it is very difficult for the PGR in Mexico City to quickly respond to all of the allegations 8 which can be generated by a coordinated effort to deceive this Court. As a result the ability to 9 obtain a response to specific allegations cannot be quickly received. However, if the Court 10 wishes to continue to focus only upon the physical custody of the aircraft, please consider the 11 Affidavit attached hereto and hereby incorporated by this reference as Exhibit A. This is an 12 affidavit transmitted to the undersigned by Jere T. Miles on October 5, 2005, by internet 13 transmission. Agent Miles assured the undersigned that he drafted this affidavit and that the 14 information contained was true under penalties of perjury of the laws of the United States of 15 America. From this exhibit, it is apparent that the PGR maintains control over and will not 16 abandon the custody of the two aircraft which are the object of the in rem process in Mexico. 17 As an alternative, the Court has before it all of the claimants to this action who are both

18 filing pleadings before the Court which urge the Court to find the service of in rem process has 19 failed, while at the same time are utilizing unique Mexican judicial process to avoid or prevent 20 compliance by Mexico with the MLAT treaty it has with the United States. To clarify what is 21 really the obstacle, plaintiff urges this Court to consider ordering Abed/SIASA to bring the two 22 aircraft to the United States District of Arizona, in obedience to the service of the of in rem 23 process. If Abed/SIASA no longer has a basis in Mexico to support the Amparo claims that the 24 government of Mexico is acting in an unconstitutional manner, then the obstacles disappear. If 25 Abed/SIASA cannot comply with the order of this Court because the government of Mexico 26 cannot comply with the Order of the Court, then it is apparent that in rem process and the MLAT 27 procedure has failed. It is simply not true, as alleged by Abed/SIASA, that the Amparo process 28 has prevented or frustrated the service of the in rem warrants. This approach would also provide
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1 an immediate solution regarding the continued storage and maintenance expenses incurred by 2 the Republic of Mexico in serving these warrants. As the Court is aware, the expenses 3 associated with maintaining aircraft are huge, and the consequences of improperly caring for the 4 aircraft are extreme. Mexico wishes to avoid these expenses by quickly selling the aircraft and 5 limiting its liability. It has advised that it needs the approval of this Court to sell the aircraft. 6 Continued delay in addressing this issue only magnifies the expenses and potential liability of 7 Mexico in the service of the warrants issued by this Court. Requiring the aircraft to be brought 8 to Phoenix by SIASA cures all of the issues before this Court. 9 The Court has personal jurisdiction over the claimants appearing before the Court and can

10 enter such an order to enforce its jurisdiction. See Barnstead Broadcasting Corp. V. Offshore 11 Broadcasting Corp. 869 F.Supp 38 (D.D.C. 1994); Burger King v. Radzwiz, 471 U.S. 462 12 (1985); Hanson v. Denkla, 357 U.S. 235 (1958). SIASA has no more than a possessory interest 13 in defendants 2 and 3, modified by the execution of the Substitute Custodian Agreement. As the 14 result of a breach of that agreement, SIASA no longer has possession of the res now in the 15 custody of the government of Mexico. The actions of Abed and Ross Castillo involved in money 16 laundering activity within the District of Arizona may be imputed to SAISA and all of the other 17 shell or front companies appear in this action. See Duoe v. Unocal Corp., 448 F.3d 915, 92518 931 (9th Cir. 2001). The personal jurisdiction over SIASA is also supported by the fact that 19 SIASA has filed a statement of interest and an objection to entry of default, and therefore has 20 clearly appeared in this action seeking to recover its interest in the three defendants. See Giusto 21 v. Ashland Chem. Co., 994 F. Supp 587 (E.D. PA. 1998). In short, if SIASA has any interest 22 in the defendant aircraft, then this Court can order SIASA to bring the Aircraft to Arizona and 23 to stop interfering with the service of the warrants. If SIASA no longer as an interest in the 24 aircraft, either due to its failure to comply with the Substitute Custodian Agreement with the 25 PGR or for any other reason in Mexico, or due to the award of Judgment of its interest in the 26 United States, then the issue regarding the significance of the Amparos is moot. 27 28
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SUMMARY There is no basis for the two defendant aircraft to be stricken from the above captioned

3 action. The motion to reconsider the order dismissing these aircraft should be granted and the 4 focus directed to the merits of the complaint, which can and should be competently heard by this 5 Court in Phoenix, Arizona. The concept of fundamental fairness requires a court somewhere to 6 hear the allegations of the fraud and money laundering which have deprived Inverlat Bank of 7 the funds stolen from it by Ross Castillo and his colleagues. If a fair hearing cannot be held in 8 Phoenix, then move the case, or as much of it as is appropriate to the District Court for the 9 District of Columbia. The important thing is to progress to the merits of the case and contribute 10 no more delay to the maliciously false and indefensible allegations of the Abed claimants. For 11 the above stated reasons in this Reply and in the original Motion plaintiff respectfully urges this 12 Honorable Court to reconsider its Order dated July 26, 2005, or in the alternative grant further 13 relief as requested. This Court need not waste any more time considering the significance of the 14 amparo process in Mexico, where all of the parties necessary to the resolution of this matter are 15 before the Court in this action. Further briefing about the status of the Amparos is not going to 16 materially contribute to the resolution of the issue of the service of the in rem warrants. 17 Respectfully submitted this 6th day of October, 2005. 18 19 20 21 S/ Reid C. Pixler 22 23 24 25 26 27 28
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PAUL K. CHARLTON United States Attorney District of Arizona

REID C. PIXLER Assistant U.S. Attorney

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Leonard J McDonald, Jr Tiffany & Bosco PA Camelback Esplanade II 2525 E Camelback Rd 3rd Floor Phoenix, AZ 85016 Cynthia Eva Hujar Orr Goldstein Goldstein & Hilley 2900 Tower Life Bldg 310 S St Mary's St, Ste 2900 San Antonio, TX 78205 [email protected] K Lawson Pedigo Miller Keffer & Pedigo 8401 N Central Expressway , Ste 630 Dallas, TX 75225 [email protected]

CERTIFICATE OF SERVICE
I hereby certify that on October 6, 2005, I electronically transmitted the attached document to the Clerk's Office using the CM/ECF System for filing and transmittal of a Notice of Electronic Filing to the following CM/ECF registrants: Allen B Bickart Law Office of Allen B Bickart PO Box 44005 Phoenix, AZ 85064 [email protected] Douglas F Behm Jennings Strouss & Salmon PLC Collier Ctr 201 E Washington St, Ste 1100 Phoenix, AZ 85004-2385 [email protected]

I hereby certify that on October 6, 2005, I served the attached document by U.S. mail, who are not registered participants of the CM/ECF System:

Marc S. Nurik Ruden McClosky Smith Schuster & Russell, PA PO Box 1900 Ft Lauderdale, FL 33302

S/

Victoria Tiffany

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